Professional Indemnity Insurance – an overview

You are a high flying professional commanding respect in your profession; earn a handsome remuneration and pretty much satisfied with the demands and perks of your profession. Understandably, you do not reckon that much can go wrong in this picture perfect setting. But, the next thing you know that a client has sued you and you are held liable by a court of law. This is exactly where having professional indemnity insurance can be of great help. It can wrench you out of the financial turmoil you have landed yourself into, during the simple discharge of your duty. No wonder people across the world consider getting professional indemnity insurance, a small cost for a great and secure future.

True to its name professional indemnity insurance protects a professional from a future loss that may arise due to a liability for damages. In case of a legal liability, it shifts the onus of making the payments to the aggrieved party on to the insuring agency, and the insured person is thus saved from the financial consequences.

There is a wide plethora of professions that can be insured under this cover. Every professional who either sells his knowledge or skills to clients or is involved in giving them advices can have the protection of this cover. This includes professions as varied as those of doctors, lawyers, architects, accountants and consultants.

The Professional Indemnity insurance cover takes care of the compensations made for professional negligence or breach in the duty of care which the professional commits on the course of delivering a service to a client. Additionally, all the legal costs of the suit are also covered by the insuring agency. The insurer can either choose a cover where he makes the payments which are later reimbursed by the insuring agency or he can go for a “pay on behalf” wherein the insuring agency takes care of all the payments and the associated paperwork.